Patent Suit Bills Found Wanting

PALO ALTO, Calif. — Congress is expected to pass legislation soon to curb frivolous patent infringement suits. But experts warn that the current draft bills are hampered by a lack of hard data and could have unintended consequences.

"I think some form of patent reform directed at litigation abuse will pass, though it may not be what the House has passed," Mark A. Lemley, a Stanford Law School professor focused on intellectual property, said in an email exchange with EE Times. (The House of Representatives passed Innovation Act, HR 3309, in December.) "Most patent academics, like most innovative companies, recognize patent litigation abuse as a serious problem and want to see something done about it."

David J. Kappos, former undersecretary of the US Patent Office, is currently in private practice with the New York law firm Cravath, Swaine & Moore LLP. "My view is legislation is quite likely to move forward and we can get it right... to do some modest things to discourage [frivolous] suits without discouraging good faith innovators," he told EE Times. However, current draft legislation "also has provisions that are not going to achieve [its] goals but will have regrettable downsides."

Specifically, the draft legislation would require losers to pay court costs. The provision "needs to be carefully calibrated... so it only applies where the loser is taking a position that is not substantially justified," Kappos said. Otherwise, it could favor the more wealthy party in the suit.

Another provision calls for delaying the expensive process of discovery until the court examines the patents in the case, reducing upfront costs of a trial. However, current drafts "reach too far into the discretion of the judicial branch," he said.

One other provision tries to eliminate the practice of suing companies such as retailers, cafes, and innkeepers that lack financial and technical resources to fight a patent suit. However, draft legislation is written in a way that could stretch unintentionally to apply to supply chain manufacturing partners. The good news is "there are briefings going on as we speak... [that could] steer legislation to a center point."

How about extending that fee structure to rape cases, murder cases, work injury cases? How much would Nicole Simpson and Ron Goldman's families owe OJ? I suppose you can save a lot of money and build a lot less prison by doing so.

True, you don't need patents. You can write technical papers for a good living. Or you can keep everything secret, which is what large companies do. They come to conferences to listen, nose around and contribute nothing of intellectual value. They call it innovate inside. Or you don't need to innovate at all, like some other countries.

The founding fathers choose a punitive patent system that made America today. America's flavor of innovation is very down to earth and commercial driven. It is different from that of the Russians, the Japanese, and the Chinese. It is the envy of the world. Why would we craving for the world norm?

me3 wrote: If only the very very rich can afford to innovate, then there is something wrong with the country...

Anyone who's been paying attention has noticed that there are a number of things wrong with the USA regarding the very very rich. But I'll stick to the topic at hand.

You don't need patents to innovate. You may need patents to make money off your innovations, but often not. For example, Microsoft didn't need any software patents to take over the PC software market. However, they later tried to use software patents to stifle competition.

When large companies butt heads regarding patents, it's not what you've patented -- it's how many patents you have. What do you do when IBM comes to you and says: "Here's 1000 patents we have: we say you're infringing on some of them. If you try to defend yourself against one patent suit after another you'll run out of money long before we do. You'd better pay the Danegeld."

"As we sat down in our Menlo Park conference room, Bill [Gates] skipped the small talk, and went straight to the point, 'Microsoft owns the office productivity market, and our patents read all over OpenOffice. We're happy to get you under license.' That was code for 'We'll go away if you pay us a royalty for every download' – the digital version of a protection racket."

Sun Microsystems did not ink a patent covenant agreement with Microsoft.

[Schwartz' reply to Gates:] "'We've looked at .NET, and you're trampling all over a huge number of Java patents. So what will you pay us for every copy of Windows?' ...it was a short meeting."

So what would the outcome had been if Sun hadn't had a pile of Java patents with which to counter Microsoft? They would have been stuck.

If only the very very rich can afford to innovate, then there is something wrong with the country. Why would they do that anyway? If someone bought the patents, you can be sure they are infringing on some of these very patents. Unlike the Chinese who write patents to fill government quota and feed their inferiority complex, real companies don't. It is a weapon for innovative small firms. It is a tool for driving innovation on the national level. But it is being weakened year after year, along with your other constitutional rights.

me3 wrote: If you don't litigate, why file patent at all? spending $50K to have a line on your resume?

Many USA companies obtain patents as a defensive measure to protect themselves from other companies that may use their patents as a way to stifle legitimate competition. For example, Google paid US$12.5B for Motorola Mobility a couple of years ago. Many people think that this was just to obtain a huge pile of patents so as to protect Android from the likes of Apple and Microsoft. It would have been nice if Google had used that money to do things like make Google Groups better, but patents in the USA are a very expensive game (especially in a hot area like mobile computing) and if you want to play you'd better be really, really rich.

If you don't litigate, why file patent at all? spending $50K to have a line on your resume?

Or you expect someone to come knocking on your door for permission to roll out his product? Say, from a company that says f- you to Apple. Oh yes, he would be so kind to Johny Thomas the little engineer, who rents an apartment, sleeps in the garage, eats ramen and pays blood sucking lawyer with a used scope?